G7 host Japan poised to pass a new law that would undermine the Group’s efforts to combat the global illegal timber trade

G7 ministers meeting in Niigata on
23rd April are
expected to discuss the Group’s efforts to combat the global trade in illegal
timber, which is worsening climate change and fuelling international organised
crime. Prime Minister Abe’s government is eager to show that Japan is keeping
up with its G7 peers. But a new bill to address illegal logging now being
fast-tracked by Japanese legislators lacks teeth and threatens to undermine the
regulatory standards of other member states.

Japan is the world’s fourth biggest importer of wood products
and a major destination for illegal timber from some of the world’s most
endangered rainforests. Despite this, it is the only G7 member that has yet to
pass legislation banning the trade in illegal timber. The bill expected to be
introduced in parliament next week stops well short of this. It would create a
voluntary system that allows companies to choose whether or not to check the
legality of the wood products they buy.[1] Companies would be under no obligation to stop
dealing in illegal timber.

“Much of the world has woken up to
the need to tackle illegal logging, which is generating billions of dollars for
corrupt officials, unscrupulous companies and organised crime, while
dismantling our planet’s life support system,” said Hana Heineken, Senior
Policy Advisor at Global Witness. “Japan is a conspicuous exception. Unless the
government requires companies to stop buying illegal timber, Japan will be a
lame duck in G7 efforts to tackle illegal logging, and illicit timber will
continue to flood its market. Japanese legislators have recognised the need to
act– now they must move quickly to ensure the new law is effective by making it
binding on all timber traders.”

G7 member states first agreed to tackle the booming market for
illegal timber at the 2005 Gleneagles summit. Since then all members except
Japan have banned the trade in illegal timber in an effort to choke demand.
Laws in the US, EU and Canada mean that companies caught importing illicit
timber now risk hefty fines or even jail sentences. While Japan was the first
G7 country to pass a law restricting the trade in illegal timber, it is only
required for public procurement, which accounts for less than 5% of the market.
Beyond this, company participation is on a voluntary basis.

In Wilful Ignorance,
Global Witness assessed the buying habits of seven major timber importers in
Japan, which dominate Japan’s tropical plywood imports, the largest in the
world.[2] We found
that all seven buy timber from the rainforests of the Malaysian state of Sarawak,
where a timber industry riddled with corruption and illegality is driving one
of the highest deforestation rates in the world. All seven do business with
Sarawak logging companies for which Global Witness and others have previously
reported evidence of illegal logging.[3] None of the Japanese companies that responded
to Global Witness’ survey[4] knew the forest area in Sarawak where all of
their timber came from, nor had they actually checked their suppliers’ logging
operations. Despite this, they claimed that all timber they imported from
Sarawak was legal.

The UN Office on Drugs and Crime estimates that approximately
50% of all wood products from Sarawak are illegal. Many companies in the EU,
US, and Australia, where trading in illegal timber is prohibited, say they
specifically avoid timber from Sarawak as it is simply too risky.[5]

Sarawak timber exported to Japan is used to feed the country’s
huge construction and housing industries, often to make disposable concrete
moulds that are used two or three times and then thrown away. Global Witness’
2014 Two Worlds Collide exposé found construction sites across
Tokyo littered with the remains of Sarawak’s rainforests, including on sites
operated by contractors hired for the 2020 Olympics in Tokyo.[6]

“Japan’s toothless voluntary approach is in stark contrast to
the mandatory measures put in other G7 member states. Earlier this year, one of
the biggest timber traders in the US was handed a $13 million fine for
importing illegal timber. Japan’s proposed law contains no meaningful deterrent
for dealing in illegal timber, putting companies that invest in cleaning up
their supply chains at a commercial disadvantage to those that do nothing,”
said Heineken. “Passing the bill in its current form would be a significant
blow to the global regulatory regime against illegal logging and casts serious
doubts over the country’s pledge to host an environmentally sustainable Olympic
games.”

[1] The proposed law would
promote the use of illegal timber by allowing companies dealing in timber
products to be officially registered as legal wood suppliers if they can merely
show they are properly checking the legality of the timber they buy. The law
does not prohibit the trade in illegal timber, as is the case with legislation
adopted by other G7 states, nor does it require companies to conduct due
diligence, as is the case in the EU and US.